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BHP's Operations Services to help lift labour performance: Mackenzie

BHP is seeking to maximise the value of coal in its portfolio by reducing turnover and improving labour performance through its Operations Services subsidiary, BHP CEO Andrew Mackenzie told the Global Metals Mining and Steel conference.

"BHP is committed to maintaining its global competitiveness, and to achieving ongoing advances in performance," Mackenzie said.

Operations Services is an organisation created within BHP to accelerate productivity improvements and reduce its use of labour hire workers, according to the company.

"A team of directly employed, permanent workers will be assembled in Operations Services to deliver services currently outsourced through labour hire companies," the company said.

"It is expected the new roles will drive business improvements and better performance.

"People will have the opportunity to apply for permanent roles with BHP that include benefits such as job stability, competitive salary, performance related bonuses, flexible work options and permanent entitlements including paid parental, sick and annual leave, and access to the company share program."

However, Construction Forestry Mining and Energy Union state president Stephen Smyth said BHP would eventually transition its central Queensland coal workforce off existing union-negotiated site agreements and on to Operations Services agreements that pay about $30,000 a year less.

Mackenzie said the company would also be seeking to revert down to long-term strip ratio of about 11:1 bank cubic metres.

"[Coal can have] improved equipment productivity through increased availability and utilisation," he said.

Also, according to Mackenzie, there is the opportunity for blending optimisation across sites to improve yield and significant growth optionality exists at the Blackwater coal mine.